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China property investors spend less abroad

Hong Kong

CHINA'S real estate outbound investment in the first six months fell to its lowest level since 2015, property consultancy firm Cushman & Wakefield said in a report, mainly hurt by tighter controls on lending.

Chinese institutional investors spent US$4.3 billion on property overseas in the second quarter, said the report published on Wednesday, a 45 per cent slide from a year ago. For the first half, volume fell 37 per cent to US$9.9 billion. This led Cushman & Wakefield to downgrade its forecast on the full-year investment volume to be 40 to 50 per cent lower than 2017, compared to an original forecast of a 30 to 40 per cent drop.

"Things may get worse before they get better," said Jason Zhang, head of China outbound investment & advisory services at Cushman & Wakefield. "Geopolitical issues will negatively impact investment, mainly in the US market for the remainder of the year."

In the second quarter, the firm said China's deleveraging had a bigger impact on investment volume than the country's new rules on outbound property investment.

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However, investments in the office space increased from the first quarter, up 44 per cent to US$3.6 billion, though Cushman & Wakefield expected investment activities in the sector would be limited for the rest of the year. REUTERS

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